The present invention relates to methods and apparatus for automatically determining the approval status of a potential borrower with respect to a loan, particularly a mortgage loan. In particular, the present invention relates to a computer-automated method and system for determining the approval status of a potential borrower in which a borrower sends a form containing predefined information relating to the potential borrower by facsimile transmission from a remote location to a control location and receives a real-time response automatically from the lender regarding the approval status.
Generally, determination of the approval status of a potential borrower for a loan has been accomplished either by conventional manual processes or by using a computer-based system. Using the context of home mortgage lending to illustrate these processes, the potential borrower first selects the home he/she is interested in. The manual determination processes typically require that the potential borrower fill out a lengthy mortgage application form, submit this form to the lender or mortgage originator and wait several days for the application to be processed by the lender or mortgage originator. During this processing period, assembling and processing of the information required to make a lending decision are carried out manually. These tasks typically include: (1) calling a credit bureau to pull a credit report; (2) scoring the credit worthiness of the applicant, in most cases manually, and making a subjective judgement; and (3) determining whether the requested amount of the mortgage falls within the bounds of a maximum multiplier of the potential borrower's income. Generally, at this point, the potential borrower would be notified if there were any problems concerning approval of a loan and, thus, could infer if he/she had a good or bad chance of ultimately securing a mortgage from the lender.
However, these methods are less than satisfactory because of inefficiencies and confidentiality problems. That is, the process of determining if the potential borrower can obtain a mortgage is not completed until after considerable time is spent selecting and negotiating for a house; if the potential borrower is denied the loan, the time spent selecting and negotiating for the house is wasted. Further, the process of determining if the potential borrower can obtain a mortgage typically takes at least two to five days, which may limit the potential borrower's options. In addition, this process involves disclosure of sensitive information to several people, including the mortgage originator and, usually, the real estate agent.
Computer-based systems have been developed that require the potential borrower or real estate agent to input information relating to the potential borrower's ability to acquire a loan, such as his/her social security number, income and expenses, directly into a computer. The computer then performs a credit scoring and credit checking analysis to determine whether the potential borrower is eligible for a loan.
However, because many individuals are intimidated by computers, these computer-based services frequently are not used. Further, use of computer-based systems generally requires training someone, such as the real estate agent, how to use the system, which requires a significant investment in time and resources. In addition, as with the manual processes, sensitive information is usually required to be shared with another, such as the real estate agent, to input the information; perspective buyers may shy away from providing this information to another or may provide incorrect information depending upon the buyer's relationship with the real estate agent.
Thus, there exists a need for a method and apparatus for automatically providing a fast response to a potential borrower's inquiry regarding his/her approval status for a loan that does not require the potential borrower, or another person, to input sensitive data related to the potential borrower's ability to obtain a loan into a computer. Because this need can be met by a process in which the potential borrower completes and sends by facsimile transmission a form that contains information relating to his/her ability to obtain a loan to the lender or agent of the lender, there also exists the need for a method, and associated apparatus, for automatically scanning and interpreting the facsimile transmission copy of a form coded to contain predefined information.
Generally, methods for automatically scanning and interpreting information located on a form that has been received by facsimile transmission, such as those routines currently available for scanning or optical character recognition routines, are limited by their lack of accuracy and/or by the necessity for inputing information onto the form using characters that conform to a particular size and style, such as those produced electronically or by a typewriter. However, these methods are not suitable because accuracy is vital to a lender's decision regarding approval status and because it is desirable for the potential borrower to enter sensitive information regarding his/her ability to obtain a loan directly onto the form, such as by hand.
Thus, there exists a need for an improved method, and associated apparatus, for automatically scanning and interpreting a coded form in which distortions of the image caused by facsimile transmission do not prevent accurate automatic translation, particularly if information on the form has been entered by hand.